While it is tempting to let your business grow "organically" and respond to changes in customer tastes and market trends, this unplanned approach can hurt your business. Developing concrete plans helps you guide your company in a positive direction and prevents going down any expensive roads that lead to nowhere. Several risk areas can threaten your business if you do not have plans in place to monitor problems and stop them in the early stages.

Payroll

A lack of planning may cause you to hire new employees every time you see a need in a department. If you do not balance these needs with the consideration of what you can afford, your payroll expenses can zoom out of control. In short, you must plan for enough growth to justify increased payroll and make sure that plan includes a cost-effectiveness evaluation for each position. This will tell you if new employees' efforts are paying off in increased profitability.

Marketing

Marketing can seem like a vague enterprise. You may feel that you are aimlessly searching for customers and waiting to see who buys before you target a particular market segment. In fact, you can do research and identify potential target markets. You could also allocate marketing funds for each target group and measure the results of your expenditures. If you fail to make a marketing plan, you may waste a lot of money with the hit-or-miss approach of advertising to the marketplace in general.

Debt

It's easy to imagine that each new project you finance will pay for itself by making enough money to service the debt and leave a profit. In reality, some projects fail. If you continue to finance projects as you think of them without a debt plan, you may over-borrow. Part of your financial planning should include monitoring the percentage of debt you carry in relation to your income. Without such a plan, you could quickly end up owing more than you make.

Product Development

Part of your growth depends on introducing new products or services to the market. It takes time to develop these. You need to do test marketing, try out different features, examine financing needs and look at how a new product fits into your overall offerings. If you don't have a product-development plan, you may waste money pursuing products that have no chance of succeeding, adding more products than you can afford to finance or introducing products that conflict with your brand.

About the Author

Kevin Johnston writes for Ameriprise Financial, the Rutgers University MBA Program and Evan Carmichael. He has written about business, marketing, finance, sales and investing for publications such as "The New York Daily News," "Business Age" and "Nation's Business." He is an instructional designer with credits for companies such as ADP, Standard and Poor's and Bank of America.